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23. November 2017

Castings profits slip despite improved sales performance in first half

Castings profits slip despite improved sales performance in first half

British iron casting and machining firm Castings saw its pre-tax profits decline in the six months leading to 30 September despite rising sales over the period.

Customer demand for Castings foundry operations was steady throughout the half with output of 23,500 tonnes, just 100 less than it reported at the same time a year earlier, and external revenues of £58.5m, 7.9% higher than in 2016.

Profit from the group's foundry segment of £6.9m represented a 10.5% year-on-year period, driven by "significant progress" made in improvements to the unit's production and productivity, however, the result was negatively impacted by raw material price increases and cost associated with the disruption in supply from the machining business.

CNC Spreadwell, Castings' machinery segment, generated £3.3m of revenue throughout the period, 10.9% less than it had a year before, bringing the unit to a total loss of £1m as opposed to the £800,000 profit twelve months earlier.

A Friday trading statement said, "The business has experienced significant issues, including production problems, during the period which have impacted both the machining and foundry operations."

CNC's managing director resigned from the board on 2 October.

Looking forward, the firm said, "Demand from our commercial vehicle customer base remains steady and therefore the full year result for the foundry operations is anticipated to be in line with market expectations."

As of 1000 GMT, shares had fallen 6.52% to 430.00p.

Source: digitallook.com

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